new ways to make culture and discover value

American culture* in the digital space (case study # 3)

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This is a series of posts that examines how and why American culture matters to American business. The opening post was “American Culture* and the Harvard Business School discovery,” and you can find it here.

I promised I’d look at several case studies in support of my thesis which is:

American culture matters and business is bad at it.

The opening case studies were about a commodity called orange juice and a Consumer Packaged Good called Coca-Cola.

This raises the question: does culture matter to other kinds of enterprise?

I have a friend who gives advice to startups in Silicon Valley. (I will give you his name if he gives me permission.)

A couple of years ago he was talking to a couple of guys who were persuaded that they had created an app that must take the world by storm.

It wasn’t quite clear to my friend what the app was for or how it created value.

To help the guys clarify, he asked,

“So who’s your user?”

The guys looked at him with surprise.

Then one said,

“Well, the user!”

This is what things sometimes happens in Silicon Valley. It’s a little like a return to the 19th century. American capitalism made stuff that was manifestly useful. A hammer, for instance. You didn’t have to know anything about the “user” here.

Except that apps, networks, and digital instruments are not manifestly useful. They are less like a hammer and more like a possibility. Often they are a solution in search of a problem. Not very clear at all.

We know this because it often takes us several false starts to discover how to use an innovation.

Take the case of photographs. The digital space courses with photographs. There are 95 million photos and videos shared on Instagram each day.

This is a mystery.

I mean, if the number was much smaller, a couple of million, say, I would be inclined to say, “Sure. People like to share their photos.” But 95 million? This is not a casual interest.

In fact, a third of the 800 million users on Instagram say they look at the platform several times per day. Wha?

This passionate interest took everyone by surprise. The digital world was slow to see that photographs would matter so much. They absolutely did not see that photos would become the “secret ingredient” of the internet economy. (One exception here might be Chris Hughes, the guy who persuaded Facebook to take photos seriously.)

A couple of years ago, I wrote a post called “the mysterious properties of the photograph.” If I may, I will quote a couple of paragraphs.

“We tend to think that photos matter because they are a record of the world. But this is only the necessary condition of their significance. The reason they really matter is that they are the single, smallest, richest, cheapest, easiest token of value and meaning online. We mint them. We trade them. We accumulate them. We treasure them.

Individually, photos are content coursing through our personal “economies.” They are the single most efficient way to build and sustain our social networks. We gift people with photos. They reciprocate. Hey, presto, a social world is confirmed and enlarged.

Collectively, photos create a currency exchange. They are a secret machine for seeing, sharing, stapling, opening, sustaining and making relationships. Want to know where networks are going? See who is giving what to whom, in the photo department.

Photos are in constant flight. They are a kind of complex adaptive system out of which some of our social order comes.

Why did Zuckerberg pay $19 billion for Whatsapp? He was following the photos, that secret ingredient of the internet economy.”

I missed something when I wrote this post. What I didn’t see is that these photos matter because people use them to craft public images and personal identities (aka “personal brands) in a culture that makes everyone their own press agent. This is one of the things it means to live in a celebrity culture.

Studying American culture helps us see that,

photos have a larger, cultural, significance

people take and share them for specific, non-utilitarian, purposes

advantage goes to the digital players who best aid and abet these purposes

Sometimes the consumer / user / person is looking for a hammer. They’re looking for the most practical solution for the most obvious of problems.

But sometimes they are engaged in social and cultural work. They are building social networks and personal reputations.

And in this second case, a deep understanding of American culture is the difference between buying WhatsApp for a couple of million and several billion. This thing called culture, it can save you a fortune.

✻ Why do I call it “American culture?”

To distinguish it from “corporate culture.” There are two kinds of culture an organization must understand and a manager must manage.

Culture Inside: this is the culture of an organization, the “corporate culture.”

Culture Outside: this is American culture.

We sometimes confuse these. But that’s a little like confusing American football and European football. My Culture Camp is dedicated to understanding American culture, the culture outside the organization. This is where we find blue oceans of opportunity. This is where black swans of disruption find us. It’s time we made the distinction.